Florida's tax estimate is lowered

The Associated Press

Published Wednesday, November 15, 2006

TALLAHASSEE -- With Florida's soaring housing market coming in for a landing, government economists said Tuesday the state will have lower tax collections next year than previously expected -- although overall state revenue will still be higher than last year.

When they craft the budget for next year, state lawmakers will have about $2.3 billion more in general tax dollars to spend than they spent last year, an increase of about 8 percent.

But while there's more money to spend, it's not as big an increase as economists had forecast earlier this year.

The state's consensus estimate for next year's incoming general revenue dropped by $466 million on Tuesday, almost entirely because of the slow down in what had been a booming housing market. The downward revision was a stark change from the rosy forecasts of the last three years -- in which economists have continually had to increase their incoming tax estimates.

Home sales are sagging, and while economists haven't agreed on how deep the retrenchment will go or how long it will last, they agree that it will mean far lower collections on the tax on real estate transactions.

Economists have noted the slowing housing market, and have warned for more than a year that the pace of sales -- and the resulting windfall in taxes -- would soon slow.